• I. Introduction
• II. Governance
• III. Acute Inpatient Utilization
  • A. Northerness
  • B. Higher Separation Rate
  • C. Influence of Changing Demographics on Need for Acute Beds
  • D. Aggressiveness of Utilization Improvement Targets
  • E. Repatriation
  • F. The Coronary Care Unit (CCU)/Intensive Care Unit (ICU)
• IV. Operating Rooms
• V. Emergency Services
  • A. Designation of Sudbury as a Trauma Centre
  • B. Effect of Hospital Services Consolidation on Ambulance Transfers
• VI. Mental Health: Inpatient Services and Planning
  • A. Sizing of Mental Health Inpatient Services
  • B. Location of Mental Health Beds
  • C. Planning for Mental Health Services
• VII. Capital Investment
  • A. Children's Treatment Centre
  • B. Revised Capital Costs
• VIII. Reinvestment to Support Restructuring
  • A. Home Care
  • B. Severance/Decommissioning Costs
  • C. Sub-Acute Care/Transitional Care
  • D. Chronic Care
  • E. Rehabilitation
  • F. Long Term Care
  • G. Summary of Reinvestments
• IX. Estimated Operating Savings from Restructuring
• X. Health Services Restructuring in Sudbury: Summary of Key Directions
• XI. Concluding Remarks
  • A. Clinical Content and Assumptions
  • B. Style of Analysis
  • C. Interpretation of Assessment of Expansion Capability, Functionality and Life Cycle Costs
  • D. Timing of Construction
  • E. Equipment and Furnishings Budget

I. Introduction

On September 30, 1996, the Health Services Restructuring Commission (HSRC) released its Notices of Intention to Issue Directions and the Sudbury Health Services Restructuring Report to hospitals in Sudbury. In response to the Notices, representations were received from individuals and organizations in Sudbury and provincial organizations. In some areas, representations received by the HSRC and further research resulted in changes to the directions contemplated in the Notices, while in others, the original directions as stated in the Notices were maintained. This report highlights the changes and must be read in conjunction with the September 30^th report.

Many of the representations received by the Commission were detailed, well researched and very specific to particular elements of the Notices and the Sudbury Health Services Restructuring Report.

The HSRC reviewed all of the submissions. The topics and issues raised related to a number of categories:

• governance of the Sudbury hospitals
  
• consideration of "northerness" as a factor in determining the sizing of inpatient hospital services
  
• levels of acute inpatient services to address:
  
  • changing demographics of the population served in future
  • repatriation of additional services in Northeastern Ontario
    
• planned levels of mental health inpatient services need to address the requirements of the District of Sudbury and the District of Manitoulin
  
• assumptions regarding the number of operating rooms may not be applicable to Sudbury hospital-based clinical practice
  
• level of coronary care unit and intensive care unit resources may not be sufficient
  
• the need to address the location of the Children's Treatment Centre
  
• assumptions regarding capital infrastructure and total capital costs estimates, including equipment
  
• concerns regarding the accessibility of emergency and trauma services
  
• time frame for implementation

The volume and the quality of submissions received by the HSRC speaks to the genuine interest the residents of Sudbury have in the restructuring of health services in their community.

Strong support for the need to restructure the Sudbury health system building on the work of the Manitoulin-Sudbury District Health Council was expressed, as was a sense of urgency to implement restructuring expeditiously. Many of the representations supported the notion of a single acute, chronic and rehabilitation hospital site with a new governance structure.

The people of Sudbury deserve a system that is more fully integrated to serve their needs. Their system of health care must respond to these needs with an appropriate level of service that is not based on historical circumstances, the lack of available lower cost and more effective alternatives, or the convenience of providers. Services must be provided in the most effective and efficient manner possible. The HSRC firmly believes that the system of health care outlined in its directions to date will improve the quality, accessibility and affordability of health care services in Sudbury.

The HSRC also believes that its directions are the basis for developing a sustainable health service system. That system will excel in the provision of high-quality cardiovascular care, services for high-risk infants, orthopaedic surgery, and a host of other hospital-based health care services. In addition, Sudbury residents will receive more coordinated care delivery with fewer transfers between providers and greater attention to satisfying their full hospital care requirements in one facility. The practitioners and workers in the Sudbury health care system will enjoy the benefits of improved coordination, fewer sites and availability of alternative services e.g. transitional care beds. Physician coverage of all hospital services, including emergency, will improve with the consolidation of services. The critical mass of caseload and expertise will attract more specialists to Sudbury, and the improved conditions will provide for greater retention of those physicians currently practicing there.

While attainable, these accomplishments will require the dedication and hard work of everyone in the health care system over the next few years. Implementation of changes as sweeping as those anticipated in the HSRC directions is a bridge as yet uncrossed in this community and others like it in Ontario. The restructuring challenge will be to accomplish it in a way that sees both gradual and quantum steps along the way to ease patients, practitioners and staff into the hospital and health care system of the future.

II. Governance

Governance of Sudbury hospital services has been a subject of discourse between the existing four hospitals and the community for a number of years. While support for simplifying the governance structures exists in the community, the question of just what model would best suit the community in terms of composition and structure, has not been addressed.

In the 1992 report of the Ontario Public Hospitals Act Review Steering Committee, entitled "Into the 21^st Century (Into the 21^st Century - Ontario Public Hospitals Report of the Steering Committee, Public Hospitals Act Review, February 1992) it was outlined that governance responsibilities vary in scope between institutions and organizations providing an array of hospital based services but there are a set of common responsibilities that include:

• outlining purposes of the hospital, its goals, objectives, the hospital's mission, quality of patient treatment and care, relations with professionals, staff, the community and province, reporting relationships, public access and accountability;
• defining and maintaining the principles, value, culture and ethical environment of the hospital, its relationships to its patients, the communities it serves and to the other providers and stakeholders in the health services system;
• ensuring the long-term fiscal and physical viability and integrity of the hospital;
• overseeing the effective management and financial health of the hospital; and,
• ensuring and monitoring the quality of services in all aspect of hospital operations (Into the 21^st Century - Ontario Public Hospitals Report of the Steering Committee, Public Hospitals Act Review, February 1992)

The HSRC, in its report of September 30, 1996, called for the creation of a new Sudbury Regional Hospital Corporation through the transfer of assets from the three existing corporations to the Sudbury Regional Hospital. The HSRC stated that discussions led by a facilitator should result in the development of a plan for hospital governance of all hospital based acute, chronic and rehabilitative services and programs. The governance structure would be designed to be representative of the communities served and have regard to the demographic, cultural, geographic, ethnic, religious and social characteristics of the Sudbury and Northeastern regions of Ontario. The report also stated that in reviewing options the HSRC gave due regard to the unique cultural, linguistic, religious and ethnic makeup of Sudbury which was viewed as fundamental to the ongoing viability of any governance structures that result from HSRC directions.

The HSRC had hoped that during the 30 day representation period the leadership of the four hospitals would have begun to discuss options for governance. For many reasons these discussions did not occur. The HSRC continues to be of the view that the specifics of the governance structure and its implementation can best be developed locally.

The HSRC is of the view that governance models are available that will satisfy the requirement for integration of health services that do address cultural, linguistic, religious and ethnic considerations and requirements. It is the responsibility of local community leaders to explore and arrive at models that satisfy their unique circumstances. There are a number of principles that the HSRC has articulated over time that guide its decision-making respecting governance:

• the tradition of voluntary governance has served Ontario communities well over the past century and should be maintained and enhanced in a restructured health services delivery system
  
• there are significant benefits to be derived from the diversity, tradition and culture of the broad array of hospitals and health care organizations in the province
  
• diversity, tradition and cultural differences must not, however, stand in the way of the necessary shift from autonomy to interdependence to facilitate more effective and efficient services for patients
  
• the priority of governance structures must be to promote the development of interdependencies on which a smoothly coordinated, strategically planned, functional system can be built and maintained
  
• there is no one "best" system/model of governance, but there is a need to find better ways' to promote greater integration, efficiencies and effectiveness across the various components of the hospital and health care system
  
• models of new forms of governance should emerge in a manner that will contribute the strengths and talents of individual organizations to discharge their collective responsibilities and to preserve and enhance the distinctiveness of each of their organizations and institutions

Having considered the representations, the HSRC remains of the view that a single site and governance structure for acute, chronic, and rehabilitation services best serves the needs of the Sudbury community. In accordance with this direction, the HSRC will be appointing a facilitator to assist in the deliberations over the nature and content of a governance plan for Sudbury hospital services that will take into consideration:

• the cultural, linguistic, religious and ethnic characteristics of the communities served
  
• creation of a corporate entity that will govern the provision of hospital based services in the community
  
• the regional nature of many hospital based services
  
• the unique nature of hospital based mental health services and the role of the Algoma Hospital/Network North
  
• the contributions of the existing hospital boards as an important foundation in the creation of the new Sudbury Regional Hospital Corporation

The HSRC looks forward to receiving a governance plan that addresses a number of issues including:

• representation on the board of directors
  
• membership of the corporation
  
• mission of the Sudbury Regional Hospital Corporation
  
• disposition of assets
  
• relationships to charitable foundations
  

III. Acute Inpatient Utilization

A. Northerness

Northerness, as a factor used in determining resources, has never been quantified in any methodologies reviewed by the HSRC. Northerness' is usually related to the geographic distance from facilities, the climate and its effect on transportation, the transportation infrastructure and its effects on travel times and hence access to care. Indeed, the HSRC in the September 30, 1996 report, explored extensively the referral patterns; i.e., populations using the Sudbury hospitals and the hospital use by residents of Sudbury and environs. What was evident from these analyses was a very localized hospital usage. Furthermore, the urban nature of the Sudbury population does not suggest significant distances to be traversed to access hospital care.

B. Higher Separation Rate

Hospitals in Sudbury had a 17% higher rate of separations (discharges) than the rest of the province in 1994/95. The following chart illustrates the difference.

This difference in separation rates when converted into acute patient days translates into an additional 25,000 days which is the equivalent of 83 beds that were used in Sudbury more than the provincial experience for a population of the same size. Of course, this is a comparison only with the provincial average. Some urban communities operate at a much lower rate as the above chart demonstrates.

The HSRC has not adjusted the separation rates in Sudbury or Thunder Bay, although both are significantly over the provincial average. The degree to which these elevated separation rates are due to "local" factors is not known. In the September 30, 1996, Sudbury Health Services Restructuring Report, the HSRC concluded that the higher pattern of hospitalizations in Sudbury could not be explained sufficiently by demographic, socio-economic, geographic or other factors to recommend its change. Therefore, Sudbury's 17% differential from provincial averages is maintained.

C. Influence of Changing Demographics on Need for Acute Beds

For the most part, the September HSRC report recommendations did little to change the rate of separations. The conservable separations identified in the HSRC analysis (i.e., Case Mix Groups 851, Other Factors Causing Hospitalization, and 910, Diagnoses Not Generally Hospitalized, and conversion of inpatient surgery to day surgery) (In 1994/95, total conservable cases equaled 523, add to this the 219 cases due to repatriation leaves a net of 304 conservable cases) drops the rate only slightly to 119 separations per 1,000 population, maintaining a 17% higher rate than the provincial average.

As noted in the following graph, the review of changing demographics, specifically in population growth and aging to the year 1999, will generate a need to add approximately 1,030 cases to the Sudbury hospital system. At the separation rate of 119 per 1,000 population, these changes will also add 3,261 patient days or the equivalent of 11 additional acute care beds. This would bring the total of acute care beds to 345 rather than the 334 originally recommended. The additional beds related to repatriation are recommended over and above these totals.

D. Aggressiveness of Utilization Improvement Targets

As in Thunder Bay, the Sudbury representations expressed strong concerns about the achievement of the 75^th percentile performance level for acute length of stay. In response to this concern, the HSRC notes that the methodology is based on the premise that these benchmarks were achieved by Ontario hospitals of similar size and profile in 1994, and there have been improvements since. Although no "single hospital" achieves all of the low benchmarks there is no reason why these could not be attained if the programs, facilities and levels of care were in place to support shorter stays. The HSRC considers that the time frame for achievement of the 75^th percentile benchmark for improved utilization coincides with the completion of the physical facilities and establishment of the community supports needed to support improvements in the utilization of acute care hospital services.

The HSRC anticipated a significant lead time for the planning and management changes required to support the move to aggressive utilization improvements. Indeed, while there can be significant gains in utilization improvement over the first two years, the focus on building the basic infrastructure of an effective utilization management program needs to be present at all times.

A fully integrated and comprehensive information system is one element of such a program. This system will by necessity cross department and organization lines with common collection and reporting of data that will contribute to the operational efficiency of all units within the hospital and health care system, as well as to overall improvements in services to patients.

What will also take time and planning resources is the introduction or enhancement of patient chart review, clinical pathways, peer review, improved diagnostic turnaround time, discharge planning, admission management, and linkages with home care, community agencies and other providers and facilities. Improvement in all facets of clinical utilization will be required to achieve the efficiencies.

All of these changes will require planning and commitment to implementation. The introduction of 75 sub-acute/transitional care beds is an important component of the continuum of care that will improve hospital lengths of stay for many conditions.

Achievement of the benchmarks will require significant changes in the patterns of clinical practice in Sudbury. Although this represents a significant challenge for the medical community, other practitioners and hospital management, this level of efficiency and appropriate utilization are being achieved in other parts of the province, and in some cases that target has already been exceeded.

In fact, the provincial benchmarks are continually moving downwards; thus, it is likely that the 75^th percentile based on 1994/95 utilization will approach the median in 1998/99. While it is difficult to predict where the provincial trend will lead, the clinical utilization targets for Sudbury in 1998/99 will reflect a rate (i.e., patient days per 1,000 population) that will already have been achieved in several other parts of the province.

As currently defined, the 75^th percentile is a moving target that reflects continuous utilization improvement, changes in practice patterns and the adoption of new technologies.

E. Repatriation

In its September report, the HSRC identified greater potential for reparation of Northeastern Ontario caseload that currently bypasses Sudbury for other centres. The HSRC concluded that approximately $1.9 million in ongoing operating funding and an additional $3.5 million in one-time capital costs are required for seven or eight inpatient surgical beds and eight or nine neonatal intensive care (Level II) beds in the new Sudbury Regional Hospital Corporation to support the repatriation potential of secondary/tertiary cases of orthopaedic surgery (hip and knee procedures) and neonatal intensive care (See September 30, 1996, Sudbury Health Services Restructuring Report, page 33).

As noted in the report, consideration must be given to a number of variables in assessing repatriation potential:

• availability of services in other northeastern hospital centres
• preferences of patients and practitioners
• nature of the cases under consideration (e.g. are they incidental or emergency?)
• ability of the local hospital centre to provide the same or a better level of service

As a result of the responses to its Notices of Intention to Issue Directions, the HSRC undertook analysis of the potential to repatriate cases for identified tertiary services that are currently available locally. This additional analysis included consideration of respiratory, neurosurgery, thoracic and cardiovascular surgery cases. The patterns for each of these services showed significant referral to Sudbury already and little potential for repatriation.

The HSRC consulted with the Cardiac Care Network (CCN), an advisory group to the Ministry of Health developed to provide expert advice on the cardiac surgery needs of Ontario. An additional 4% of funding for cardiac surgery cases has already been approved for the Sudbury region. CCN goal is to increase services to the rate of 100 cardiac surgeries per 100,000 adults in Ontario. At the time of the initial CCN's recommendations, the north and east regions of the province were already in the target range of 100 cases per 100,000 adults. However, as of October 31, 1996, there had been a 107% increase in the number of patients waiting for cardiac surgery (205) compared to last year (99). The CCN working group will be reconvening to examine waiting list issues.

F. The Coronary Care Unit (CCU)/Intensive Care Unit (ICU)

There are different methodologies to predict the appropriate number of critical care beds for a population. HSRC commissioned some research into the number of ICU/CCU beds used on a per county basis. This research used an accepted methodology for assessment of needs for critical care resources. Based upon treatment location the research revealed that only 21 CCU/ICU beds were required in Sudbury in 1994/95. The HSRC had recommended a total of 25 beds (13 CCU and 12 ICU) in its Notices of Intentions. Representations requested an increase to 29 beds. The HSRC is supporting this increase and revising its capital investments to reflect it based on the overall demographic change between 1994 and 1999. However, as methodologies are refined, these bed numbers may need to be revisited.

IV. Operating Rooms

The HSRC received representations on the proposed number of operating rooms for the Sudbury Regional Hospital. Accordingly, the HSRC reviewed its methodology with the assistance of a consulting firm. An expert panel of physicians and surgeons from across Canada assisted in the analysis of results and validation of the planning approach. Input was also sought from other health care professionals. As a part of this process, the consultants, HSRC and expert panel reviewed data from all hospitals that report their OR procedure times to the Canadian Institute of Health Information (CIHI). To ensure comparability, the data were segmented by dividing the hospitals into three groups (teaching hospitals and community hospitals larger than and less than 100 beds). The data were reviewed for coding errors then analyzed. Based on the preliminary advice received by the HSRC, the methodology used to calculate OR requirements is being amended as follows.

Surgeries were split into three levels of surgical caseload: ambulatory, primary/secondary and tertiary. The changes in the methodology relate to OR availability, specifically, the hours of operation and number of days per year. Preliminary advice received by the HSRC indicates that planning for tertiary ORs should assume they will be scheduled for 10 hours per day. All other ORs should be scheduled for nine hours per day. These planning guidelines also call for the ORs to be operated 240 days per year to allow for statutory holidays, weekends, and other closures.

It was noted as part of the review that there is unscheduled downtime in the ORs for patient cancellations, etc., but this is offset by after-hours surgery, largely emergency surgery. The following table shows the revised calculations for Sudbury.

The revised methodology identifies a need for 17 operating rooms in Sudbury, five more than originally estimated. Within the total of 17 the final decisions on the mix of ORs, hours of operation and other aspects are the responsibility of the hospital and its medical staff. These issues will be finalized in detailed pre-design planning.

This planning methodology is a work-in-progress and these figures on OR requirements may require revision in the near future.

V. Emergency Services

A. Designation of Sudbury as a Trauma Centre

Submissions received by the HSRC suggested that the Sudbury Regional Hospital should be designated as the Regional Trauma Centre for Northeast Ontario. The Sudbury General Hospital is currently designated by the Ministry of Health as one of 10 lead trauma centres in Ontario. This designation will be maintained at the Sudbury Regional Hospital. As a lead trauma hospital there will continue to be funding for the following components of the trauma program:

• infrastructure costs, including medical director, clerical staff, hardware and software for data collection
  
• trauma team leader salaries, based on the number of cases
  
• incremental volume funding based on the number of cases over the established base

The Ministry of Health is reviewing the system of emergency room designations for Ontario. Should there be a change, the Regional Hospital should pursue the appropriate designation with the Ministry.

B. Effect of Hospital Services Consolidation on Ambulance Transfers

In 1995/96 local non-emergent inter-hospital patient transfers amounted to 3,600. Given that a single hospital will provide acute, rehabilitation, chronic and acute mental health care at one site, there will be no requirement for this level of transfer. Based on information provided by the Ministry of Health's Emergency Health Services Branch, the HSRC estimates the reduction could result in an annual savings of $250,000.

Further planning of ambulance service requirements by the Ministry of Health should assess the impact of the health services restructuring on the need for ambulance services for Sudbury and adjust services in line with the implementation of hospital restructuring accordingly.

VI. Mental Health: Inpatient Services and Planning

A. Sizing of Mental Health Inpatient Services

A number of submissions noted that the HSRC had failed to consider the populations of the districts of Manitoulin and Sudbury, basing its estimates instead on the population of the Regional Municipality of Sudbury as projected to 1999. The following table summarizes the need for inpatient mental health services in 1999 with the other populations considered.

Sudbury & Area Mental Health Bed Requirements
Resident Population 1994	171,651
Resident Population 1999	180,181
Add: Projected Resident Population Manitoulin District	12,015
Add: Projected Resident Population Sudbury District	26,180
Resident Population 1999: REVISED TOTAL	218,376
Mental Health Beds Staffed and Operation	68
Sudbury RM Rate of MH Beds per 100,000 Population	31.1
Provincial Rate Beds per 100,000 Population	30
Former MH Beds Required at Provincial Rate (1994)	54
Revised MH Beds Required at Provincial Rate (1999)	66
Acute MH Beds Required at Provincial Rate (1999)	39
Psych rehab MH Beds Required at Provincial Rate (1999)	27

The revised analysis shows a need for an additional 12 beds to meet the needs of the population in 1999 at the rate of 30 beds per 100,000 population. This is the planning rate used in Putting People First (Ministry of Health, 1993), a key document in mental health reform policy. These beds break down into eight additional acute crisis beds and four additional psychogeriatric/rehabilitation beds. Neither total would offer sufficient critical mass to be located in any of the facilities in Manitoulin or Sudbury districts. Therefore it is recommended that the beds be located in Sudbury and that the facility planning be adjusted accordingly. This brings the total for adult mental health beds to 66. This increase in bed numbers will increase the annual operational reinvestment from $0.7 million as per the September report, to $1.6 million.

B. Location of Mental Health Beds

A number of submissions suggested that the siting and relative composition of the mental health beds (i.e., the numbers of acute crisis versus psychogeriatric/rehabilitation) be changed. The location of the acute crisis beds in the acute facility is in keeping with mental health reform and satisfies the clinical coherence criteria used by the HSRC in assessing siting options. Because the emergency department is at the acute site and patients can find broader medical services in addition to mental health services, the HSRC position is to maintain the location of acute crisis beds at the Ramsey site. There may be a need to alter the mix during the implementation phase due to the following:

• There are currently more "tertiary" and "chronic" mental health beds (i.e., psychogeriatric/rehabilitation) than acute crisis beds in the system. The changes anticipated in mental health reform are predicated on the availability of broader community services options, such as case management services and supportive housing.

• There will be considerable construction requirements at the Ramsey site, necessitating at the very least the temporary siting of beds at other sites.

These issues will require some attention during planning. It was never anticipated that the community move to 30 beds per 100,000 population immediately, but that detailed planning and implementation would see a gradual movement to that standard.

Location of resources during the construction period and in the final configuration will be a major piece of the detailed facility and services planning that must precede construction. This is the responsibility of the local providers.

C. Planning for Mental Health Services

The Northeast Region Mental Health Advisory Committee has already been established by the six district health councils in Northeastern Ontario. This body has been planning for some time and is near completion of its work, which significantly parallels the recommendations of the HSRC. The HSRC therefore amends its recommendation on establishing or steering committee to the effect that the current group continue to plan, and that it adapt to its planning process the broad requirements the HSRC outlined in its September notices.

One of the outcomes of planning will be the need to consider establishment of a regional mental health agency, as recommended in the September 30, 1996 Notices and in the October 4, 1996, Directions in Thunder Bay. While specific terms of reference will need to be worked out between the Ministry of Health and the community, it is expected that this Agency will be responsible for:

• needs assessment, including setting and monitoring of service levels and outcomes
  
• management of the mental health funding envelope, and determining reallocation of funds within the envelope
  
• ensuring that quality mental health care is a priority throughout the service delivery system
  
• ensuring an adequate mix of outpatient programs, and facilitating the delivery of these programs at general hospitals or other community sites
  
• ensuring the continuation and enhancement of a number of mental health services, including:
  
• a broad range of outpatient programs and support services
  
• community counseling services and other support programs
  
• rehabilitation programs

Meeting the target of 30 beds per 100,000 adults for inpatient mental health beds will require reinvestment in community-based services such as case management, ongoing monitoring, and flexibility to adjust service capacities to meet needs before existing beds are closed. Restructuring the regional service will demand a significant level of reinvestment of the mental health savings in the community and will, therefore, need to be a priority issue for a regional mental health agency.

VII. Capital Investment

Restructuring of the health system in Sudbury will require a major infusion of capital funds. The HSRC recommended to the Ministry of Health that the new Sudbury Regional Hospital Corporation be given approval for a plan for a capital construction project to renovate and expand the Ramsey site. The recommended expansion will accommodate the emergency department, operating rooms, labour and delivery, critical care beds and support services.

Five distinct themes emerged in the responses on the assessment of capital costs, options and redevelopment:

1. the basis used to compare clinical content (i.e., size of the program(s)) of the redeveloped hospital as compared to the capital costs of the HSRC's analysis and those of the respondents
   
2. the style of analysis used by hospital capital/space planning consultants
   
3. the interpretation of local assessment of functionality, expansion capability and life cycle costs associated with existing physical plants
   
4. the period for planning and construction
   
5. the equipment budget associated with the option selected

The HSRC asked its capital consultant to examine the responses individually and collectively and to assist it in responding to the issues raised. The detailed comments are included as an appendix to this document. In sum, while there are varying views and approaches, the HSRC stands by its initial assessment of options and costs related to capital, subject to modifications due to changes in the scope and nature of the clinical activity to be provided in the facilities.

A. Children's Treatment Centre

The need to relocate the Children's Treatment Centre (CTC) to the Ramsey site was identified in some of the representations. The CTC is a community-oriented rehabilitation facility that provides assessment, consultation, education and therapy to children and young adults with motor disabilities and communication disorders. The program receives direct funding from the Ministry of Health and the Ministry of Community and Social Services; additionally, the Ministry of Education provides funding through the school system for the educational component of the program.

Currently the Laurentian Hospital is responsible for the CTC and has established a mechanism for community input through an advisory committee, the Children's Treatment Centre Committee, a standing committee of the Laurentian Board. Originally located at Laurentian, the program is now in a leased space in a school about a 10-minute drive from the hospital.

It has been recommended that returning the program to the hospital site would increase the program's clinical efficiency and improve its access to clinical resources. This move also would enable the CTC to carry its program into the hospital setting and improve the integration of community and hospital services for these children and young adults. A needs assessment/master program undertaken in 1989 recommended that the CTC be located on the hospital grounds in a separate building. The Manitoulin-Sudbury DHC Hospital Services Review report recommended that rehabilitation services, including the CTC, be located at the Laurentian site. It is estimated that the CTC would require a building gross area of 17,000 square feet (sf), based on the 1989 needs analysis.

At a construction cost of $140 sf (including northern allowance), and including ancillary, site development and furnishing and equipment allowance, the total cost for relocation of the CTC amounts to $3.83 million. Due to the age of the study upon which these estimates are based, the cost estimate is not included in the revised total capital costs, due to the need for additional specific planning that needs to occur during the pre-design phase of the Sudbury Regional Hospital.

The HSRC recommends that responsibility for the program be transferred to the new hospital. The HSRC supports the move of the CTC to the hospital site, possibly located in a separate facility. The HSRC also recommends a short focused review of the existing needs assessment/master program to ensure that the proposed CTC scope is still appropriate. The study should be led by the hospital but include representation from the funding agencies, the District Health Council and the CTC's advisory committee. The study should also determine the operating savings that would be achieved from the relocation, as well as estimated reinvestments required for the relocated program based on the size and scope required for the region.

B. Revised Capital Costs

The maximum total capital costs have been revised to incorporate the number of beds added as a result of further analysis by the HSRC (See September 30, 1996, Sudbury Health Services Restructuring Report). The recommended facility plan actually provides for 417 inpatient beds, not the 410 originally stated. This offsets seven of the 11 added acute care beds and leaves only four to be added to the plans. As well, further review of critical care bed needs resulted in a recommendation to increase this complement by four beds. In addition, other usable facilities and space were considered upon further review in the development of the revised capital estimate. Therefore, the capital costs required amount to an additional $1.28 million inclusive for additional ICU/CCU's, operating rooms and inpatient beds.

The maximum total budget for the construction project including construction and renovation costs, contingencies, and site development amounts to $72.1 million for recommended levels of acute, chronic and rehabilitation inpatient and outpatient services plus an additional $3.5 million for repatriation of neonatal and orthopaedic caseload. The Kirkwood site capital costs amount to $0.87. The total budget for equipment and furnishings has been set at a maximum of $9 million. This amounts to an increase of $4.8 million dollars in capital costs over the September 30^th report.

In summary, the HSRC is recommending that the total capital costs of renovations and new construction at the Ramsey and Kirkwood sites not exceed $85.5 million including equipment and furnishings. This total does not include the capital costs of relocating the Children's Treatment Center on the Ramsey site as this is pending further planning.

VIII. Reinvestment to Support Restructuring

A. Home Care

Reinvestment is a critical component of health system reform and will be necessary to ensure that utilization reduction targets are achieved and that the downsizing of the hospital sector is supported by investments in other parts of the health system.

Based on the advice received by the HSRC, an investment of $1.2 million in home care services is recommended to support aggressive utilization management, shortened stays and increased day surgery in the hospital services and programs in Sudbury. Additional research is being conducted into the development of a more refined methodology for determining the amount of home care reinvestment required to support clinical efficiencies. Final estimates of the need for additional home care services may be altered as a result of this research.

B. Severance/Decommissioning Costs

The HSRC acknowledges that there will be a number of one-time costs related to restructuring such as decommissioning plants, transfer of health records, severance packages and labour adjustment strategies. Some of these costs can be funded from existing working capital resources of the hospitals. However, the HSRC did not have current information on the level of the working capital resources available for this purpose. The HSRC will advise the Ministry of Health that these be funded out of the savings and existing working capital on a one-time basis without reference to source of funds.

C. Sub-Acute Care/Transitional Care

A key resource that will be required by the physicians and hospital staffs in reducing the length of stay is a transitional/sub-acute level of care. The concept of sub-acute and transitional care services is the development of a programmatic approach to care of non-acute patients that is focused on achieving specified, measurable outcomes in an efficient, lower cost environment. HSRC research into hospital costs for patients awaiting discharge who are past the acute phase of their illness or condition has shown that the costs parallel general inpatient costs for these patients and that specialized programming is not evident. The HSRC had earlier noted that the requirements for transitional care/sub-acute care could be met in long term care facilities or dedicated sub-acute facilities (where volume warrants) due to the nature of the care requirements. The HSRC also noted that between 3 and 3.8 hours of nursing or a combination of nursing and therapy services per day were used as an average patient requirement. Currently the average nursing hours per patient per day in long term care facilities is approximately 2.15 hours.

While the HSRC has recommended transitional care in Sudbury the types of care that are required form two broad categories:

Transitional Care - where the patient does not require acute services but whose care requirements indicate long term care. However, the initial level of care requirements may not be available in publicly funded facilities under the existing current financial and regulatory environment. Additional funding and services beyond existing levels may be required for a short portion of the entire stay in the long term care facility.

Sub-Acute Care - where the patient does not require acute services but is not yet ready for discharge to their home and community and may require separate and distinct inpatient services such as skilled rehabilitation or nursing. Sub-acute patients may require:

• treatment and/or assessment of the care plan by physician;
  
• nursing intervention of more than 3 hours per day; and,
  
• therapy services (i.e., physiotherapy, occupational therapy, etc.)
  
• ancillary or technological services such as laboratory, pharmacy, nutrition, and diagnostics.
  
• case management/coordination services

The HSRC is aware that preliminary research findings through the Non-Acute Utilization Study of the Joint Policy and Planning Committee show a significant portion of current hospital days of stay for some of the case types under review are "Sub-Acute". This confirms some of the assumptions underlying the recommendations of the HSRC.

Planning for either transitional or sub-acute level of care based on the proxy of numbers of alternate level of care patient days is not sufficiently robust to address true requirements given the variation in reporting of Alternative Level of Care (ALC) cases by physicians and hospitals. Alternative approaches based on population characteristics, caseload types, utilization improvement potential and program requirements will be needed to address the supply of sub-acute or transitional care services.

The HSRC is aware that this level of care is only beginning to be introduced in Canada. Indeed, Alberta is the only jurisdiction that the HSRC is aware of that is in the process of introducing sub-acute services. However, no such programmatic development has been undertaken in the Ontario context. A requirement for common programmatic approaches, standard definitions, policy adjustments to facilitate the introduction of services and acceptable and appropriate planning methodologies are urgently required to facilitate the development of both transitional and sub-acute levels of care. The HSRC will immediately convene a task force comprising of representatives of hospitals, long term care facilities, nursing, rehabilitation, and physicians to address these requirements.

D. Chronic Care

The recommended number of chronic care beds, at 100 beds, has not changed from the September, 1996 report. The HSRC is currently undertaking a review with service providers in this sector to assess the adequacy of the chronic care bed supply. A report is expected by the Commission in January 1997. As a result of this review the bed numbers for chronic care may be revised.

E. Rehabilitation

The recommended number of rehabilitation beds at 31 has not changed from the September 1996 report which called for an increase in rehabilitation beds from 22 to 31. The HSRC has received one representation noting that there are no other rehabilitation beds in the Northeast Region. The view of the HSRC is that this requirement will be addressed as the HSRC continues its review of hospitals and the health care needs of northeast Ontario. Furthermore, some rehabilitation requirements may be addressed in sub-acute beds. The HSRC is currently undertaking research into inpatient and outpatient rehabilitation requirements. The results may influence the number of beds dedicated to rehabilitation.

F. Long Term Care

Both long term care and chronic care facilities charge a co-payment for accommodation. In order to avert this payment, admissions may be sought at acute care facilities. As well, patients whose acute phase of care is complete, but who remain in hospital as alternative level of care patients because the care required is not immediately available, also had not been charged a co-payment rate. Since the time of the HSRC's September report, a new regulation was passed which stipulates that acute care facilities can now charge a co-payment to patients awaiting admission to long term care or chronic care facilities. The HSRC would like to take this opportunity to commend the Ministry of Health for taking steps to eliminate the inappropriate use of acute care facilities and for providing these facilities with a means to ensure that all patients are treated fairly.

G. Summary of Reinvestments

The following table summarizes the reinvestments required for the restructuring of the Sudbury Health services system.

Estimates of Reinvestment Requirements
Category	Amount
Sub-acute/Transitional Care Beds	$2.8 to 3.2M
Home Care	$1.2 M
Repatriation	$2.0 M
Medical Personnel	$3.3 M
Chronic Care	$1.5 M
Rehabilitation	$0.6 M
Acute Mental Health (adult/crisis)	$1.6 M
Magnetic Resonance Imaging	$1.0M

IX. Estimated Operating Savings from Restructuring

There were a number of changes in the estimates based on:

• new service requirements - i.e., 11 additional acute beds
  
• changes to information based on feedback in representations
  

As a result of these changes, the total savings is reduced by approximately $1.2 million, resulting in a new total of $40.7 million in annual savings related to:

• clinical efficiencies
  
• support services consolidation
  
• administrative efficiencies
  
• savings from restructuring (e.g., program transfers)

Details regarding these savings are noted in an appendix to this document.

X. Health Services Restructuring in Sudbury: Summary of Key Directions

• Development of a governance structure through the use of a facilitated approach leading to a single governance and management for acute, chronic and rehabilitation care hospital services.
• Separate governance for mental health and community-based care.
• Consolidation of all acute, chronic and rehabilitation care services to be delivered on one site to achieve the goal of less expensive quality hospital care for the future.
• Inclusion of an MRI machine to improve accessibility to this important technology
• The following configuration of hospital-based services:

		Sept. 30 Report	December Report 1996
Bed/Service Category	1994/95	1999	1999
Bed Types:
Acute	571	334	345
Chronic	78	100	100
Adult Psychiatric	68	54	66
Paediatric Psychiatric	12	12	12
Rehabilitation	22	31	31
TOTAL BEDS	751	531	554
Transitional Care Beds	0	75	75
Operating Rooms	21	12	17
Emergency Visits	97,500	93,500	93,500
Total Ambulatory Care (incl. ER)	199,300	193,500	193,500

Note: Totals do not include repatriated beds in orthopaedic surgery and neonatal intensive care.

• the estimated total reinvestment requirement to support restructuring is $14.4 million annually
• the estimated total annual savings in operating costs related to hospital based acute, chronic and rehabilitation services is $40.7 million.
  

XI. Concluding Remarks

Restructuring of the health care system in Ontario is one of the largest public sector initiatives ever undertaken in Canada. Decisions about how best to change that system must be based on good data, sound information, common sense, the long-term interests of the community, economic realities and, most important, be in the best interests of quality patient care. The HSRC has done its best to ensure that its final decisions have been carefully evaluated based on the criteria of accessibility, affordability, and quality.

The challenge that lies before Sudbury, and other communities across the province, is not to be underestimated. Managing the process of change at the community level will require the collective involvement and commitment of everyone who values our health system. The HSRC believes that its final directions will facilitate positive change in the hospital system, both to maintain and improve patient care and to address future financial challenges. The directions also establish a solid foundation for the system-wide integration of hospital services and may ultimately lead to the unification of the hospital system to provide effective and efficient patient care that meets the needs of the local community as well as the residents of Northeastern Ontario.

The task will not be an easy one. The HSRC's vision is that the community will work together to bring about the changes necessary to create workable solutions to health care reform.

Appendix A

Revisions to Savings from Restructuring the Sudbury Hospital System

Two adjustments were made to the calculation of savings from restructuring. The first adjustment deals with Admission Avoidance (CMGs 851, 910 & MNRH) under the Clinical Efficiency section. Using the direct cost per weighted case in the calculation as opposed to total cost per weighted case, the Admission Avoidance component decreases saving from $464,916 to $347,837. This results in a reduction of $117,079 in the total Clinical Efficiency Savings Potential. This reduction has a cascading effect on the remaining savings as they are all discounted for any initial clinical efficiency savings. The smaller clinical efficiency savings in the denominator of the formula results in a corresponding increase in the Support Services, Administrative Efficiencies and Program Transfer savings. This is a relatively small change increasing Administrative Efficiencies and Program transfers by $17,866.

The second adjustment deals strictly with the Support Services Savings. A review of the primary and secondary accounts that roll-up into the Clinical Laboratory, Dietary and Materials Management was undertaken. This resulted in additional accounts that appropriately belonged in these support services. The largest impact was in the Laboratory area where an additional $3,532,666 was added. Dietary and Materials Management were increased by $289,698. These changes increased the savings estimates by $882,042 when discounted for the new clinical efficiencies.

Appendix B

Assessment of Capital Costs

A. Clinical Content and Assumptions

The "clinical content" refers to the specific level of clinical activity assumed in sizing and costing facilities. The original analysis took into account an additional $3.5 million allocation identified by the HSRC for repatriated services. The scope of the clinical content and thus space included these services (to the best of the ability to be specific at this general level of planning). Thus, the differences identified in "bricks and mortar costs" of the HSRC estimate is not comparable with local estimates unless the capital costs for repatriated services are included. There were also some differences in clinical space consideration related to CCU/ICUs and operating rooms in some representations.

B. Style of Analysis

While there is general agreement in some representations that the capital construction costs estimates are comparable, capital consultant/space planning professionals have differing styles and analytical techniques, resulting in discrepancies in costing. One area of discrepancy in costing methodology is the allowance used for ancillary costs, with HSRC's standard allowance being 23.2%. One representation had used 37.2%, resulting in a total project costing difference when comparing bottom lines.

The analysis of new space and renovated space requirements in one representation identified a difference from the model used by HSRC. This was not unexpected, as the planning done by the respondent's consultants represents a more refined level of detail in the planning process. It is reasonable to expect such shifts as a result of some fine tuning. However, the overall scope of redevelopment is consistent, and the principles underpinning it are the same (major rebuild of the surgical suite, creation of an emergency department, etc.).

C. Interpretation of Assessment of Expansion Capability, Functionality and Life Cycle Costs

The HSRC relied on the same materials used in the study by the Manitoulin-Sudbury District Health Council and the facility plans, drawings and related materials provided by the Sudbury hospitals themselves to assess the feasibility of expansion and/or consolidation of services at any site.

The long-term usability and functionality for ongoing use of a hospital building is influenced by its age and internal configuration. The ability to configure space to achieve efficient staffing, to promote ease of supervision, allowing adjacencies between specific services to maximize operational effectiveness, and support a client-focused environment, must also be considered. Thus, while the age of the facility is a factor, the ability to arrange and configure the spaces internally contributes as much or more to an assessment of long-term usability and functionality.

For instance, the most recent 1971 construction at the Paris site is approximately 22,800 square feet per floor, which significantly restricts the flexibility of department arrangement/configuration on each floor. The floors of this newest wing rely heavily on the of B and C Wings being adjacent to ease this otherwise highly restrictive situation. These wings, built in 1948, add approximately 9,400 square feet to the floorplate, increasing it by 40%. They are, however, 48 years old and can contribute in only limited ways to the functional content of A Wing.

At the Ramsey site, the oldest building stock dates from 1975 and represents 72.5% of the existing area. The balance (110,600 square feet) is only three to six years old.

Site development difficulties in terms of community resistance, parking and zoning issues are discussed on pp. 5-11 of the November 1993 report Analyses of Hospitals

Existing Facilities, relating to the Sudbury General Hospital and prepared for the District Health Council by ADI Limited. This analysis was not considered out of date because issues of this magnitude could be rectified in a space of three years only through a major, redevelopment project, which did not occur.

A concern was raised about the reduction in capacity of the future facility as compared to the DHC recommendations (p. 7), at a "roughly comparable cost" (DHC's range $90 to $133; the HSRC analysis indicated $83 million). The reduced area of 26% cannot be directly applied to cost reduction of an equivalent value due to differences in how the required area may or may not be implemented.

D. Timing of Construction

The HSRC received comments that the period required for planning and construction of the Ramsey site expansion would have to be expanded from that anticipated in the HSRC notices. The premise for this assertion seems to be twofold:

insufficient time for pre-design planning activities

longer construction period required due to local conditions

The HSRC is aware that the timelines are condensed. The assumed pre-design timeline of approximately six months is premised on expeditious approvals by all levels of government involved. The construction period is based on best industry practices in hospital construction, including restrictions due to environmental factors in northern communities. These timelines issues can be resolved only through further detailed planning

E. Equipment and Furnishings Budget

The HSRC consultants use appropriate industry ratios of equipment/furnishings costs to construction costs to establish the equipment budget, recognizing that, as appropriate, the full allowable depreciation expenses, accumulated by all hospitals, will be used to fund equipment and furnishings that are not part of the construction contract. This is in accordance with prevailing Ministry of Health policy and accounting rules.

The HSRC views further elaboration of equipment costs as beyond its ability to assess, given the level and scope of HSRC planning. During the further detailed planning stages, elaboration of equipment requirements must parallel the planning of appropriate clinical activity and be based on sound and acceptable practices in the industry.